Lead-Lag Live Balanced or Broken? Jay Hatfield on Rates, Inflation, and Market Risks
Aug 19, 2025
In this conversation, Jay Hatfield, CEO and Portfolio Manager at InfraCap Funds, shares his insights on looming market risks, including persistent inflation and surging government debt. He discusses the implications of high interest rates on the U.S. economy and warns that the Fed's policy may not match market expectations. Hatfield also critiques outdated inflation measurement methods and offers investment strategies for navigating the uncertainty ahead, including advice on equities and fixed-income funds.
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Neutral Market With Tech-Driven Upside
- Markets are neutral-to-bullish because a likely Fed cut and a summer tech rally offset valuation risk.
- Jay Hatfield sees S&P upside to 7,000 but warns risk is elevated into seasonal weakness.
Add Yield Stocks For Defence
- Add lower-risk yield names like preferreds, Philip Morris and McDonald's to reduce portfolio volatility.
- Favor defensive allocations ahead of the seasonal August–September risk period.
AI Boom Creates 'Derivatives' Opportunities
- The economy is a tale of two cities: an old-economy recession versus a new-economy AI boom.
- Invest in AI derivatives like power companies and pipelines that service AI growth.